Valve have just informed us that Steam's database has been compromised.

An IM is being sent out to all Steam users. Here are the details straight from Gabe:

We learned that intruders obtained access to a Steam database in addition to the forums. This database contained information including user names, hashed and salted passwords, game purchases, email addresses, billing addresses and encrypted credit card information. We do not have evidence that encrypted credit card numbers or personally identifying information were taken by the intruders, or that the protection on credit card numbers or passwords was cracked."

Valve are investigating the situation. They mention that there's been no evidence of illegal credit card activity as yet, and that it's probably a good idea to change both your Steam passwords. To do that, access Settings from the Steam menu within the client.

Newell signs off his IM with sincerity: "I am truly sorry this happened, and I apologize for the inconvenience."